Look at any US pay stub and you'll see deductions labeled something like "Social Security" and "Medicare," or sometimes just "FICA." Together they take 7.65% of your wages — and unlike income tax, almost everyone pays them from the first dollar.
What FICA stands for
FICA is the Federal Insurance Contributions Act. It funds two federal programs through a payroll tax split between you and your employer: Social Security (for retirement and disability) and Medicare (for health coverage at 65+).
The two pieces
- Social Security — 6.2%. Paid on wages up to an annual wage base cap. Earnings above the cap aren't subject to Social Security tax, which is why very high earners see this deduction stop partway through the year.
- Medicare — 1.45%. Paid on all wages with no cap.
Your employer matches both, paying another 6.2% + 1.45% on your behalf — so the government actually receives 15.3% in total. The self-employed pay both halves themselves (that's the "self-employment tax").
The extra 0.9% on high earners
High earners pay an Additional Medicare Tax of 0.9% on wages above a threshold that depends on filing status. It applies on top of the regular 1.45%, so the Medicare rate effectively becomes 2.35% above the threshold.
Why FICA isn't reduced by your 401(k)
Here's a detail that surprises people: a traditional 401(k) contribution lowers your income-tax bill, but not your Social Security and Medicare wages. FICA is calculated on your gross wages before most pre-tax retirement deductions. We cover which deductions reduce what in pre-tax vs after-tax deductions.
See FICA on your own paycheck
The paycheck calculator breaks out Social Security and Medicare separately from federal and state income tax, so you can see exactly where every dollar goes. Read how to read your paycheck for the full line-by-line tour.